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It
wasn’t all about the Summary of Coverage documents last
Thursday. The Departments of Labor, HHS and Treasury also
issued new guidance on frequently asked
questions by employers and health plans concerning
the auto-enrollment, employer requirements and waiting
periods in PPACA. The agencies have asked for comments on
the new guidance, which is due by April 9. NAHU plans to
submit a letter on behalf of the whole association, and
we also anticipate that our Employers for Flexibility In
Health Care coalition will submit detailed comments
as well.
If
you have any thoughts you would like to share with NAHU
about the new guidance, please e-mail them to Jessica Waltman.
For
those of you who like who prefer the Cliff Notes version
rather than reading the seven detailed questions and
their answers, here is a run down of some of the key
points made in the document.
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Don’t worry about
auto-enrollment any time soon. "The
Department of Labor has concluded that its automatic
enrollment guidance will not be ready to take effect by
2014."
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What do employers have to
do to determining if their coverage is “affordable” or
not (a.k.a. whether or not the
employee is allowed to drop employer coverage and go
seek individual subsidized coverage through a state
exchange)? The document states that
"Treasury and the IRS intend to issue proposed
regulations or other guidance permitting employers to
use an employee’s Form W-2 wages (as reported in Box 1)
as a safe harbor in determining the affordability of
employer coverage."
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What about a
look-back/stability period safe harbor for
employers? "It is anticipated that the
guidance will allow look-back and stability periods not
exceeding 12 months."
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If you were wondering how
and when you are supposed to decide if an employee is
full-time or not: "Treasury and the IRS
intend to propose an approach under which the period of
time that an employer will have to determine whether a
newly-hired employee is a full-time employee (within
the meaning of section 4980H) will depend upon whether,
based on the facts and circumstances, (a) the employee
is reasonably expected as of the time of hire to work
an average of 30 or more hours per week on an annual
basis and (b) the employee’s first three months of
employment are reasonably viewed, as of the end of that
period, as representative of the average hours the
employee is expected to work on an annual
basis."
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Employers are not
required to offer coverage to part-time
employees.
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When does the benefit
waiting period clock begin to tick? "The
90-day waiting period begins when an employee is
otherwise eligible for coverage under the terms of the
group health plan."
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What is the interaction
between 90-day wait periods and employer
penalties? "The upcoming guidance is expected
to provide that, at least for the first three months
following an employee’s date of hire, an employer that
sponsors a group health plan will not, by reason of
failing to offer coverage to the employee under its
plan during that three-month period, be subject to the
employer responsibility payment under Code section
4980H."
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